A Crude Threat A Crude Threat Joshua R. Itzkowitz Shifrinson and The Limits of an Iranian Missile Miranda Priebe Campaign against Saudi Arabian Oil Developments in Iran’s ballistic missile program have made headlines over the last several years.1 In the United States, Senator Carl Levin calls Iran’s short- and medium- range missile arsenal “the number one threat in the Middle East,” and Undersecretary of Defense for Policy Michèle Flournoy argues, “The threat from Iran’s short- and medium-range ballistic missiles is developing more rap- idly than previously projected.”2 Israeli ofªcials similarly describe the Iranian missile program as “a matter of grave concern.”3 States around the Persian Gulf, meanwhile, worry that Iran’s missiles are meant to intimidate and ex- tract political concessions from them, with Saudi Arabia’s King Abdullah not- ing that the Iranians “launch missiles in the hope of putting fear in the people and the world.”4 These worries are not simply abstract concerns. At a time when the United States and its allies remain locked in a standoff with Iran over the latter’s nu- clear program, states around the Persian Gulf fear that Iran would retaliate for an attack on its nuclear program by striking regional oil installations and other strategic targets.5 Iranian ofªcials have threatened to use ballistic missiles in Joshua R. Itzkowitz Shifrinson and Miranda Priebe are doctoral candidates in the Political Science Depart- ment at the Massachusetts Institute of Technology. The authors thank Nathan Black, Eugene Gholz, Brendan Rittenhouse Green, Llewelyn Hughes, Barry Posen, Andrew Radin, and the anonymous reviewers for their comments. 1. Ed Blanche, “Iran Stages Display of Missile Firepower,” Jane’s Missiles and Rockets, November 23, 2006; Alan Cowell and William J. Broad, “Iran Reports Missile Test, Drawing Rebuke,” New York Times, July 10, 2008; and Dennis C. Blair, “Annual Threat Assessment of the U.S. Intelligence Community for the Senate Select Committee on Intelligence,” 111th Cong., 2d sess., February 2, 2010. 2. Levin and Flournoy quoted in “The President’s Decision on Missile Defense in Europe,” hear- ing before the Senate Armed Services Committee, 111th Cong., 1st sess., September 24, 2009. 3. Angela Balakrishnan, “Barack Obama Calls for Tougher Iran Sanctions after Missile Tests,” Guardian, July 9, 2008. 4. “Cables Show Arab Leaders Fear a Nuclear Iran,” Der Spiegel, December 1, 2010, http:// www.spiegel.de/international/world/0,1518,731877,00.html/. 5. Kenneth Katzman, Iran: U.S. Concerns and Policy Responses, CRS Report for Congress (Washing- ton, D.C.: Congressional Research Service, Library of Congress, October 26, 2010), Order Code RL 32048, pp. 51–52; Patrick Clawson and Michael Eisenstadt, “The Last Resort: Consequences of Pre- ventive Military Action against Iran,” Policy Focus, No. 84 (Washington, D.C.: Washington Insti- tute for Near East Policy, 2008), pp. 16–18; and Anthony H. Cordesman, “The United States, Israel, the Arab States, and a Nuclear Iran: Part Five: Iranian Capabilities to Respond to a Preventive At- tack” (Washington, D.C.: Center for Strategic and International Studies, October 7, 2008), pp. 91– 120. International Security, Vol. 36, No. 1 (Summer 2011), pp. 167–201 © 2011 by the President and Fellows of Harvard College and the Massachusetts Institute of Technology. 167 Downloaded from http://www.mitpressjournals.org/doi/pdf/10.1162/ISEC_a_00048 by guest on 28 September 2021 International Security 36:1 168 these attacks, with a senior military adviser to Ayatollah Ali Khamenei warn- ing that Iran would ªre its missiles against oil reªneries and other critical in- frastructure in the event of a U.S. or Israeli strike.6 At the same time, Iran’s efforts to develop and test its ballistic missile arsenal have led states in the re- gion to improve their defenses around critical infrastructure, including oil fa- cilities, with U.S. assistance.7 In a telling comment, a representative of Saudi Arabian King Abdullah told a senior U.S. ofªcial that he “worries more about an Iranian missile launch against Saudi oil facilities than a terrorist attack... because he can take preventive measures against terrorism but not against Iranian missiles.”8 A successful Iranian missile attack on Persian Gulf oil installations would have many of the same effects as a blockade of the Strait of Hormuz.9 By dis- rupting oil production, a successful missile strike could reduce the supply of oil on the world market and cause a spike in oil prices.10 Presumably, Iranian retaliation would be designed to impose substantial economic costs on an attacker.11 These concerns raise several questions. What are the capabilities of Iran’s missiles? Likewise, what are the military vulnerabilities in oil networks? In light of the above scenario and the alarming reports about the Iranian mis- sile arsenal, does Iran really have the missile capabilities to disrupt oil pro- duction? Is increased spending to harden oil infrastructure by Persian Gulf states worthwhile, or might such funds be better spent elsewhere? Over- all, what damage could Iran inºict with a missile campaign against Gulf 6. Michael Smith, “Iran Threatens Gulf Blitz If U.S. Hits Nuclear Plants,” Sunday Times, June 10, 2007. 7. Joby Warrick, “U.S. Steps Up Arms Sales to Persian Gulf Allies,” Washington Post, January 31, 2010; and David S. Cloud, “U.S. Set to Offer Huge Arms Deal to Saudi Arabia,” New York Times, July 28, 2007. 8. John M. Guilfoil, “The Embassy Cables: Saudis Fear Iranian Missile Strike More Than Terror- ism,” Blast, December 7, 2010, http://blastmagazine.com/2010/12/07/the-embassy-cables-saudis- fear-iranian-missile-strike-more-than-terrorism/. 9. Caitlin Talmadge, “Closing Time: Assessing the Iranian Threat to the Strait of Hormuz,” Inter- national Security, Vol. 33, No. 1 (Summer 2008), pp. 82–117; Anthony H. Cordesman, “Iran, Oil, and the Strait of Hormuz,” CSIS Brief (Washington, D.C.: Center for Strategic and International Studies, March 26, 2007), pp. 1–7; and Robert Strauss Center, “Strait of Hormuz: Assessing Threats to Energy Security in the Persian Gulf,” University of Texas at Austin, August 2008, http:// hormuz.robertstrausscenter.org/threat. 10. In 2008, global oil exports totaled 60.8 million barrels per day (mbd), including 40.1 mbd of crude oil and 20.7 mbd of reªned products. Approximately 20.3 mbd came from the Middle East, which, given the location of oil ªelds, means the Persian Gulf region. See Organization of the Petroleum Exporting Countries (OPEC), Annual Statistical Bulletin, 2008 (Vienna: OPEC, 2008), pp. 34, 36, 38. 11. Katzman, Iran, pp. 51–52; Clawson and Eisenstadt, The Last Resort, pp. 16–18; and Angus McDowall, “Iran Threatens to Cut Off Gulf Oil Exports If Nuclear Facilities Are Attacked,” Tele- graph, June 28, 2008. Downloaded from http://www.mitpressjournals.org/doi/pdf/10.1162/ISEC_a_00048 by guest on 28 September 2021 A Crude Threat 169 oil installations—speciªcally, in the scenario below, Saudi Arabian facilities— and how would it go about launching such an attack? Existing analyses of Iranian retaliatory options have not discussed the mis- sile scenario. Instead, studies of Iranian options address Iran’s capacity to close the Strait of Hormuz to oil tankers. Because the ªndings suggest that a block- ade is unlikely to be wholly successful, prudent Iranian planners might con- sider additional ways, including missile launches, attacks by special forces and proxy groups, naval assaults, and conventional air campaigns, to disrupt the ºow of Persian Gulf oil.12 Of these options, a missile campaign is among the most plausible: aside from the concerns described above, U.S. intelligence ofªcials have argued that Iran’s missile arsenal is “an integral part of its strat- egy to deter and if necessary retaliate against forces in the region.”13 This study’s analysis of the missile scenario builds upon past work on Iran’s mili- tary capabilities and addresses the policy concerns identiªed above. This article offers an initial answer to the questions highlighted above by ex- amining whether Iran could use its ballistic missile arsenal to signiªcantly re- duce Saudi Arabia’s oil production. Analyzing the threat to Saudi production provides a “worst-case” analysis from the perspective of the United States and its allies. Simply put, Saudi Arabia contains the largest conªrmed oil reserves in the world, holds the greatest productive capacity of any state, and is the world’s largest oil exporter.14 If all Saudi oil production were to cease, 9.2 mil- lion barrels per day (mbd) of oil would be removed from world markets; only the combined loss of Emirate, Iraqi, Kuwaiti, Omani, and Qatari oil pro- duction would equal these ªgures.15 Moreover, Saudi Arabia produces less oil than its maximum capacity. It has historically used its excess capacity to cush- ion oil markets by increasing production in crises to ensure a stable world oil supply. A successful Iranian missile strike could eliminate this cushion, mak- ing prices more volatile until production came back online.16 All this means 12. Talmadge, “Closing Time,” especially p. 115. 13. Blair, “Annual Threat Assessment of the U.S. Intelligence Community for the Senate Select Committee on Intelligence,” p. 21. 14. BP, Statistical Review of World Energy, 2010 (London: BP, June 2010), pp. 6–7; U.S. Energy Infor- mation Administration (EIA), “Country Analysis Brief: Saudi Arabia,” Department of Energy, No- vember 2009, pp. 2–3, 11; and U.S. Energy Information Administration, “Country Energy Proªles,” Department of Energy, http://tonto.eia.doe.gov/country/index.cfm. 15. The combined production of Iraq, Kuwait, Oman, Qatar, and the United Arab Emirates was approximately 9.2 mbd in 2008. See OPEC, Annual Statistical Bulletin, 2008, p.